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What would you consider to be an Operational KPI?

A) Inventory shrinkage rate
B) Brand equity
C) CAPEX to sales ratio
D) Revenue per employee

1 Answer

4 votes

Final answer:

The inventory shrinkage rate is considered an Operational KPI, reflecting efficient management and operations. Productivity can also be measured by revenue per employee and quality metrics, not just output per hour.

The correct option is A) Inventory shrinkage rate

Step-by-step explanation:

An Operational KPI (Key Performance Indicator) is a measurable value that demonstrates how effectively a company is achieving key business objectives. Among the options provided, A) Inventory shrinkage rate is considered an Operational KPI. It indicates the percentage of inventory loss due to theft, damage, or errors as compared to inventory records, thus reflecting operational efficiency and inventory management.

Regarding productivity measurement, while the amount produced per hour of work is a common metric, there are indeed other ways to measure productivity. These include metrics such as revenue per employee, which evaluates the monetary contribution of each employee to the company's revenue, or quality metrics like the defect rate in production, which assesses the quality of output as opposed to quantity alone.

The correct option is A) Inventory shrinkage rate

User Stefano Potter
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